ZVUE

[David Randolph]

Awesome trade kslifka   (applaud)

This stock wasn't on my database . I need to sistematically introduce new IPO's on the database, or else I'll lose all these opportunities.

Let me check some things on ZVUE:

1) "As of November 14, 2006, 11,424,247 shares of Issuer's common stock, with
$0.0001 par value per share, were outstanding." So, market cap is $55.75 M (this is why it was able to run so much, very small cap)
2) These two press releases made it fly so high:

- HandHeld Entertainment Acquires Dorks.com, a Fast-Growing Web Site Full of Hilarious Videos Attracting Up To 1 Million Unique Visitors per Month
Business Wire (Tue, Nov 14)

- HandHeld Entertainment Sees Cash Flow Positive Results in 2007, Makes First Acquisition
Business Wire (Wed, Nov 15)

3) Yesterday it came down some, possibly due to this: Handheld Entertainment Ups Public Float
AP (Thu 8:59am)

«The release of this provision will allow the 3.2 million shares registered under the prospectus to become free trading and increases the public float of the company's common stock to about 6.3 million shares.»

It doesn't make sense to go down just because of this, because this isn't dilution in any way. Those shares were already issued and outstanding, they just couldn't be sold for 180 days after the IPO, and now they can. It doesn't have any effect on the company's value, so it shouldn't have on the stock price either. But people can perceive this change as a sign that initial investors want to cash in at current prices. And this may very well be true ...

Now, ZVUE is very hard to value ... it's such a new company. There's big opportunity and big risk here. I need to study it some more, any input would be very welcome !

[David Randolph]

I guess that since Google bought YouTube for $1.65 B and YouTube had 100 million unique visitors per month, dorks.com would be worth 1/100 of that since it has 1 million unique visitors per month. This would be $16.5 M (ZVUE bought it for $1.5 M).

But I don't know, www.dorks.com perhaps is more for young kids, so its advertising potential would be worth less ... what do you think?

Anyway, say it's worth $10 M.

And what about this ZVUE players?

«The fact that HandHeld Entertainment's new value-priced $99 ZVUE(TM) 250 PVP begins shipping next week into approximately 2,000 Wal-Mart stores nationwide, replacing the ZVUE 200;»

«The launch of the $69 ZVUE ZP3(TM) MP3 player pre-loaded with 30 of the top songs of 2006 and with a firm initial order for 36,000 units being delivered into retail stores this November;»   36,000*$69 = $2.48 M.

The company is entering a space of huge potential ... I just wonder if they will stick to this:

«With the steps we have taken and that we outlined yesterday afternoon, we plan to achieve cash flow positive results in 2007 without raising additional capital»

They have $2.93 M in working capital, but it looks like they just spent $1.5 M buying www.dorks.com (damn it, I should also do a website with videos and stuff  ).

Market cap $55 M ... arrghh, I really don't know, it depends on how they will manage this Dorks site and how sales from their ZVUE will do this Christmas season ... there's room for this to double, triple or quadruple from current values, but it may also fall 50% (I would surely buy it at $2.44, or $27.5 M market cap).

Intense speculation will drive the stock over the short term, I don't think this will just lay down and die ... the theme is too hot !

Good luck 

[David Randolph]

A word of caution from their latest 10-Q:

«We believe that based on our current cash position, our borrowing capacity, and our assessment of how potential equity investors will view us, we will be able to continue operations at least through June 2007. The forecast that our financial resources will last through that period is a forward-looking statement that involves significant risks and uncertainties. It is reasonably possible that we will not be able to obtain sufficient financing to continue operations. Furthermore, any additional equity or convertible debt financing will be dilutive to existing shareholders and may involve preferential rights over common shareholders.»

I guess they were not telling the truth on the press release, when they said «without raising additional capital».

[kslifka]

ZVUE says this on Wednesday:

HandHeld Entertainment Sees Cash Flow Positive Results in 2007, Makes First Acquisition
Wednesday November 15, 3:01 pm ET
HandHeld Entertainment Execs Project Cash Flow Positive Results in 2007 without the Need to Raise Additional Capital as They Highlight Recent Steps Taken by the Portable Video Player Industry Pioneer Designed to Achieve Success with Its "Complete Portable Video Ecosystem" and Acquires Popular User Generated Video Site

and then this on Thursday

PIPE investors desiring to sell under the effective registration statement must deliver a current prospectus which is available for download as Form 424B3 filed on August 30, 2006 (File No. 333-133215) from the SEC's Web site (www.sec.gov). The release of this provision will allow the 3,238,558 shares registered under the prospectus to become free trading and increases the public float of the company's common stock to approximately 6.3 million shares.

[David Randolph]

Now I'm pretty convinced the recent press releases are just a way to get some working capital by issuing and selling shares in the open market.

Yesterday $ volume was about $78 M, nice market to get 20 or $30 M for working capital purposes 

Ramsburg tells me there are thousands of websites like www.dorks.com (although this is a funny one) ...

I guess in 6 months from now ZVUE will be trading back at $1, but with a market cap 3 or 4 times larger than the last time it was there.

Good luck for day traders, though.

[Ramsburg]

David talked with me about ZVUE earlier this morning, so I'll try to add some more inputs on this thread:

About ZVUE players, from my perspective:

- One thing I enjoyed was that they have DivX certification, so they are way more compatible then for example the iPod:
http://www.hheld.com/news/20040303.html
They are also compatible with Xvid, ASF, WMV, etc... so they lieteraly play anything.
- The data storage was in the other hand, too low... I mean 4GB, is something that is not acceptable in these days... My own cell phone has a 2GB memory card, so I was expecting something like the iPod 30GB disk storage or something.
- The design is cool, very cool... but you can't compete with iPod on this
- The price is relatively cheap, but not too cheap... this is a nice product for sure, but its still not «bombastic»... They should sell  lot.... But I'm not expecting some phenomenon here...

As a consumer, I'm still waiting for iPod to be DivX certified, and then I'll buy one... ZVUE won't be on my shopping list this Christmas.
ZVUE is a innovative product, but I expect some of the major products like iPod and Zune (Microsoft), to quickly integrate more compatibility on their players, by the way, take a look at the new Microsoft Zune:
http://www.zune.net/en-US/meetzune/device.htm

About Dorks.com, and the comparison with Youtube:

http://www.dorks.com/ is a nice website, with a good community, etc... but I don't think we should do the Math comparison with youtube.com... I mean, youtube has 100M users, and Dorks has 1M, but we should not consider that Dorks was a cheap purchase for 1.5M$, just because according to the Youtube value it should be valued in 15M$...

Youtube was bought by Google for 1.65B$, not because it had 100M users, but mainly because Youtube literally means Video in the internet.... And it would provide Google to easily dominate the video scene on the internet. 1.65B$ is the price to dominate video on the internet.... Not just the price of a given number of users...

There are probably thousands of websites like Dorks.com, if you do a quick search you can see that Dorks is not even on this first page:
http://www.google.pt/search?hl=pt-PT&lr=&q=related:www.youtube.com/


Personal opinion on ZVUE stock:

I would certainly have bought ZVUE a few days ago at $1.50 if I even knew this company existed ... But now at $4 / $5 its completely out of my radar... even with all this speculation, and speculative potential, I'm not considering to buy this stock at this level.

Best regards,

[traderdog]

Sure ZVUE belongs here!  See ya at $50

[traderdog]

Ramsburg, let's stick to the technicals, which is your area of expertise,  rather than fundamentals.

[traderdog]

c'mon Randolph, let's stick to the technicals rather than fundamentals.  If fundamentals were your cup of tea, you wouldn't be buying stocks below $10.

[traderdog]

The reason we got such a high volume (like LMRA) is because ZVUE is in a very hot sector - user generated videos.  ZVUE is a very nice speculative play that isn't highly overvalued.

What investors are excited about isn't really their low end portable video players.  It's not even www.dorks.com although it will play a significant part to start driving traffic to www.zvue.com .  The excitement is what people will be able to do once they get to www.zvue.com .  They will be able to download videos at a price to ANY portable video player they wish.  Soon, they will also be able to download videos from www.dorks.com to their portable video player.  But more significant than any of the above mentioned is that by the end of 2006, visitors will be able to upload videos to the FREE STUFF section of www.zvue.com , which anyone can download to their portable video player!  There are very few sites where you can download user-generated videos to your video player.  You can't even do that with Youtube.

What www.zvue.com is trying to do is to put everything in one site:  allowing upload/download free videos to your portable video player (any video player including ipod), allowing download paid videos to your portable video player (any video player), selling ZVUE portable players, monetize the site with ads, monetize the www.dorks.com site with ads, drive traffic from dorks.com to zvue.com .

When web 2.0 stocks start to rally hard in the next few years, ZVUE will no doubt rally with them.

[gmarc66]

actually..its doesnt traderdog.

[setravis]

Thank you Julia.
It is now where it belongs, and merged with the other ZVUE Thread.

[gmarc66]

Hey Congrats to ur new status Moderator Setravis

Great idea David and Fred...Setravis is definitley the right person for this job...those scouring eyeballs of his don't miss a thing!

Congrats to Melf Elf too!

good job guys, ur talents and efforts on the 3sf board have not gone unnoticed

I know these guys will do a great job in keeping 3SF in tip top shape.

thanks

julia

[setravis]

Hey Congrats to ur new status Moderator Setravis

Great idea David and Fred...Setravis is definitley the right person for this job...those scouring eyeballs of his don't miss a thing!

Congrats to Melf Elf too!

good job guys, ur talents and efforts on the 3sf board have not gone unnoticed

I know these guys will do a great job in keeping 3SF in tip top shape.

thanks

julia

And let us not forget AussieTrader......

[Ramsburg]

Hi traderog,

Welcome to 3SOF !
I see you are new around here...
You only have 4 posts here... and you have already a rating of -5... Probably you are entering this board a little too fast... no problem with me (for now)

Ramsburg, let's stick to the technicals, which is your area of expertise,  rather than fundamentals.

Sure, I'm a «Technical» guy... You want me to delete my post?

c'mon Randolph, let's stick to the technicals rather than fundamentals.  If fundamentals were your cup of tea, you wouldn't be buying stocks below $10.

Actually... some of the best «fundamental opportunities» can be found in stocks bellow $10, long before institutionals put them on the radar, and long before you have the desired good numbers.

I'm not sure if Fundamentals are David's cup of tea LOL I'm not even sure if David likes tea...

The reason we got such a high volume (like LMRA) is because ZVUE is in a very hot sector - user generated videos.  ZVUE is a very nice speculative play that isn't highly overvalued.

What investors are excited about isn't really their low end portable video players.  It's not even www.dorks.com although it will play a significant part to start driving traffic to www.zvue.com .  The excitement is what people will be able to do once they get to www.zvue.com .  They will be able to download videos at a price to ANY portable video player they wish.  Soon, they will also be able to download videos from www.dorks.com to their portable video player.  But more significant than any of the above mentioned is that by the end of 2006, visitors will be able to upload videos to the FREE STUFF section of www.zvue.com , which anyone can download to their portable video player!  There are very few sites where you can download user-generated videos to your video player.  You can't even do that with Youtube.

What www.zvue.com is trying to do is to put everything in one site:  allowing upload/download free videos to your portable video player (any video player including ipod), allowing download paid videos to your portable video player (any video player), selling ZVUE portable players, monetize the site with ads, monetize the www.dorks.com site with ads, drive traffic from dorks.com to zvue.com .

When web 2.0 stocks start to rally hard in the next few years, ZVUE will no doubt rally with them.

Ok... now we got something... finally a nice input to this thread !

I really enjoy these new developments on the Online Video scene, this on demand streaming directly to our video devices is something great, but ZVUE is not breaching into new territory here, and ZVUE is not alone on this... I own a KISS DP-600 wireless DVD Player, and there is already a new firmware almost done and published (ezlink), that will enable direct streaming of google videos on the DVD set, this is just an example, I'm not sure how the «scene» will be in a couple of months / years, but to be honest with you, ZVUE is not on my radar concerning this developments (as a consumer).

ZVUE has a low market cap, and it could be on fire for a while, from a technical approach I can't say much yet...

Thank you Julia.
It is now where it belongs, and merged with the other ZVUE Thread.

Setravis... always watching

Hey Congrats to ur new status Moderator Setravis

Great idea David and Fred...Setravis is definitley the right person for this job...those scouring eyeballs of his don't miss a thing!

Congrats to Melf Elf too!

good job guys, ur talents and efforts on the 3sf board have not gone unnoticed

I know these guys will do a great job in keeping 3SF in tip top shape.

thanks

julia

Julia,

Setravis was already helping us on the boards for a long time (since the beginning) So nothing makes more sense than being an official 3SOF moderator Melf and Aussie were always around too supporting our team, so we are really glad with this superb Moderation Team Not to say that now we have «eyes» from all Continents always watching the boards

Regards !